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consider a company that earned $4.00 per share last year and paid a dividend of $1.00. The firm has maintained a consistent payout ratio over

consider a company that earned $4.00 per share last year and paid a dividend of $1.00. The firm has maintained a consistent payout ratio over the years and analysts expect this to continue. The firm is expected to earn $4.40 per share next year, and the stock is expected to sell for $30.00. The required rate of return is 12%. what is the best estimate of the stock's current value?

The Answer is: $27.77

How to do the calculation for the 27.77?

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